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We're about to go and try to get pre-approved. Our credit is good (not excellent but no missed payments), though we have lots of student loans and some darn credit cards (also school related charges) that are not going to be paid off anytime soon. We could probably put down 5% on a $300K mortgage. My question is: should we talk to a bank or a mortgage broker? What's the difference? Should we look into FHA? We're hoping to get a conventional 30 year loan.
Those that do only write cookie cutter loans. That means that everything needs to be pretty good with income/assets/credit score.
If you work with a broker and a lender refuses you, he can find another lender really quickly. You may also get better pricing.
Conventional loans nowadays require 5% down in some areas, and 10% down in the rest. There are still a lot of areas that are designated 'decline areas', and those require 10% down.
This rule doesnt apply to FHA loans.
With FHA you can put 3% down, and have a low monthly Mortgage Ins payment. You will be paying an upfront FHA MIP funding fee of 1.5%.
Conventionals can offer lender paid PMI, but you will need to have a pretty decent credit score.
Quote:
Originally Posted by EuroExpat
We're about to go and try to get pre-approved. Our credit is good (not excellent but no missed payments), though we have lots of student loans and some darn credit cards (also school related charges) that are not going to be paid off anytime soon. We could probably put down 5% on a $300K mortgage. My question is: should we talk to a bank or a mortgage broker? What's the difference? Should we look into FHA? We're hoping to get a conventional 30 year loan.
I would talk to both banks and mortgage brokers. Mortgage brokers work with a much wider pool of banks so depending on what program you are looking for, they might be able to steer you in the right direction.
Banks, I found, tend to be higher priced even though you've cut out the middle man. Go figure.
Some times depends on the bank and the kind of customer you are to them...
Quote:
Originally Posted by JJPNYC
I would talk to both banks and mortgage brokers. Mortgage brokers work with a much wider pool of banks so depending on what program you are looking for, they might be able to steer you in the right direction.
Banks, I found, tend to be higher priced even though you've cut out the middle man. Go figure.
I don't think that we are to the point where only giant faceless banks exist. I have had good experiences with banks of medium to medium-large size that do understand that it is good business for them to lend money to people that are good credit risks and will continue to deposit and borrow money from them for a long time as well as potentially use them for investment services.
The other situation that I have been witness to is that the very best clients can get rates that are very attractive from banks that intend to keep loans "in their portfolio" meaning they are not going to resell them. You have to have a lot of assets and /or be part of big business to get that kind of service, but it is a real situation.
I am relocating to Virginia from NY. I want to purchase a home and the maximum LTV will be 50% with 50% down. I have assets remaining for the balance of loan in case I do not find a job right away. Want to purchase since it will be less than renting. NY getting harder to rent. Credit excellent with score above 730. I'm also Pre-approved. Worked in the same industry for 20 years too. Will a lender approve a No Income with Full assets in Virginia?
I am relocating to Virginia from NY. I want to purchase a home and the maximum LTV will be 50% with 50% down. I have assets remaining for the balance of loan in case I do not find a job right away. Want to purchase since it will be less than renting. NY getting harder to rent. Credit excellent with score above 730. I'm also Pre-approved. Worked in the same industry for 20 years too. Will a lender approve a No Income with Full assets in Virginia?
No Income is hard to do... but possible in some cases (excellent credit, assets). The problem here is that you are No Employment either. Very few lenders (hard money/equity lenders perhaps) will offer loans to someone with no income source. Those that do will charge high rates and fees because they will have to keep the loan and its risky.
We closed on our first house in March. We made and offer on a house listing for $369K and was accepted at $325K net to seller with 5% down and a 6% sellers concession. At the time interest rates were floating between 6%-7%. Because we were first time buyers and we had marginal credit (scores in the mid 600's) conventional was out of the question. Worked with 3 brokers and our CU and the best we could finance was 6.75% w/ an APR around 7.25%. And they wanted more than 5% upfront. We were on the verge of giving up when my RA put me in touch with a bank which was equipped to do FHA. We locked in at 5.85% (6.12% APR). Closing costs were higher than my friends who did conventional loans, however my PMI is $142 per month whereas their's hover over $300. FHA is a bit more complicated, alot more paperwork, however our closing was smooth as butter. No hidden fees or financial surprises. Our Truth in Lending doc matches our monthly payment almost down to the penny.
Just my experience.
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Some times depends on the bank and the kind of customer you are to them...
